Payback’s a Bitch

Consider this scenario: President Palin (or Romney or Perry or Pawlenty or whoever) is sworn in with great jubilation among movement conservatives in January 2013. Voter distaste with Democrats also led to the crushing defeat for Democratic Congressional incumbents, leaving Republicans with hefty majorities in the House and Senate. In a paroxysm of celebration, Republicans pass the Ryan budget, slashing taxes and putting major reforms in Medicare years down the road. However, the growth promised by advocates of this budget does not materialize, and (as the budget estimates) the federal government runs huge deficits for the first two years of the new president’s term. Frustrated with a series of broken economic promises, voters turn Republicans out in massive numbers in the 2014 midterms. Though Republicans cling to a narrow majority in the Senate, they are wiped out in the House, and an exultant Nancy Pelosi reclaims the title of Speaker.

In passing the Ryan budget, Congress also upped the debt ceiling by a trillion or so, but perpetual deficits mean that the ceiling is coming awfully close, and federal spending is due to break it in early August 2015. So now, in May, the president must go on bended knee to Speaker Pelosi, who demands tax increases as the price for her caucus supporting an increase in the debt ceiling.

As the Speaker tells the press after the tenth of her many meeting with the president:

Since 2000, we have cut taxes for the wealthiest ten percent of Americans to record lows and have nothing to show for it but exploding deficits and a stagnating economy for the lower ninety percent. Polls show that Americans support an increase in taxes on the wealthiest, who have the most to give and who have gained the most from our economy. It would be irresponsible to increase the debt ceiling without increasing our ability to pay for our spending. I hope the president will compromise for the sake of our nation’s future.

And what could Republicans say to this? Again, there is the wailing and gnashing of teeth in markets across the globe about America’s ability to pay its debts. Again, the Washington summer dissolves into rancor and cut-throat battle. Welcome to the Battle of the Budget Part II (of many, many parts).

The above scenario may very well not happen, but a Republican president will, at some point in the future, face a Congress wholly controlled by Democrats. Every Republican president since Eisenhower has faced at least one Congress totally dominated by Democrats. On the other hand, Bill Clinton is the only Democrat after Truman who has dealt with a Congress totally controlled by Republicans. Jimmy Carter is the last president who never faced any house of Congress controlled by the opposing political party. And every president in the living memory has increased the debt in raw dollars, requiring increases in the debt ceiling.

If dynamic of the current debt ceiling debate continues into the future, we could easily find the country grinding into a kind of financial-political paralysis every few years that one party controls one branch (or two branches) of Congress while another controls the White House. The Founders believed in certain kinds of brakes on governmental power, but I’m not sure that this specific kind is the most helpful (or even if it would not increase government power in the long run through increasing dysfunction). Under this current dynamic, Congress votes for, and the president signs, budgets demanding certain kinds of spending only to later fight about how to pay for this spending (via borrowing, tax increases, future spending cuts, and so forth). Normal prudential politics would seem to suggest that you agree (implicitly or explicitly) to agree paying for some spending before you agree to that spending.

Republicans and Democrats, conservatives and progressives, will have to weigh the implications of the current debt-ceiling discussion tactics for future administrations and Congresses. These implications might be problematic for the functioning of government and conservative goals.

43 Comments so far ↓

“These implications might be problematic for the functioning of government and conservative goals.”

These hostage tactics by the GOP have implications for the proper functioning of government right NOW.

If the Democrats were as uncaring of the welfare of the country as the Conservatives you might find this scenario playing out. However the Democratic party has proved itself to be far more interested in the future of the country and the welfare of it’s citizens that the GOP over the last 30 years.

Starting with Saint Ronny each GOP President has jacked up the deficit and left the resulting mess to his Democratic successor to clean up. Bush 2 was the culmination of the failure of the GOP.

To leave the country deep in debt, in two wars of choice and with the economy on a state of collapse was a disgrace.

Wow. If scaring the Republicans into doing the right thing by suggesting Dems are just as insanely partisan as they are works, more power to you. I don’t think it will though, the Republican party is way beyond logic at this point.

This is hilarious. You’re concerned about these barbaric political tactics being used against your party in the future but you’re not worried about the damaging use of these tactics by your own party right now?

I just find it funny that Repulicans are lecturing Democrats on the deficit. Where were their concern for the deficit when Bush was running it and the debt up? If you are honest and look at the numbers and understand the impact on the defict and debt from the recession you should come to the conclusion that this entire deficit and debt is the fault of George Bush and the Republicans.

They are lecturing the country on a problem that they caused. Why should be care about what they have to say about fiscal matters. They have no credibility. Every single Republican president since Eisenhower has increased debt per GDP and every single Democratic president has decreased debt per GDP. The Republican are the last people we should be listening to on fiscal matters.

“If you are honest and look at the numbers and understand the impact on the defict and debt from the recession you should come to the conclusion that this entire deficit and debt is the fault of George Bush and the Republicans.”

Au contraire, armstp. We all know it was teachers, cops, firefighters, trash collectors, MVD workers, and all others in government employ who caused the debt and deficit. The GOP is hard at work correcting this so that we never again suffer the effects of paying these worthless parasites on society a middle-class wage; if they want to be accepted as respectable members of society, they can get a job in the private sector and stop leeching off Real Murkans. Why, the private prison system can provide plenty of low-wage labor to perform those parasitic jobs, if we even need them performed — an open question.

@Grace… or they could go to WVA or Kentucky and work in the mines where the mine owners ignore safety regulations and kill miners; and they could live under the slag heaps of the former mountains where toxic streams kill all wildlife in the area. Sure, private industry without union control is exactly what this country needs. Then all the companies that fled to Mexico, China, the Philippines etc would come back and pay minimum wages and offer no health care or retirement benefits. Yes. That’s exactly what we need.

Remember , this is not about the debt, or the deficit, or even taxes. The Republican agenda is to put an end to the New Deal and the Great Society. They want to undo 75 years of progressive gains in 30 days. Paul Ryan is a follower, if not practitioner of Ayn Rand’s objectivism. For those of you who don’t know what that is their dogma can be summed up as “I got mine, you get yours”.

I can not understand why the Republicans — and Norquist — don’t see that these antics can easily turn “the pledge” from a positive to a negative at the polls. How many more politically inflexible politicians do we need, who have prematurely surrendered their ability to compromise to a third party?

BTW your GOP candidates have, for the most part, promised never to raise the limit.

I just can’t see the Democrats refusing to raise the debt limit unless they get what they want. That’s Republican stuff, for better or worse. I would be more worried about getting through next week, to be honest. The elites appear to be steering the bus into a telephone pole.

Here’s another scenario. Because of House GOP intransigence, we have a gov’t default that leads to a double-dip recession that boosts unemployment over 10%. Even though the House caused it by refusing to negotiate a deal, with those kinds of unemployment numbers, Obama loses the election fueled by Tea Party anger and the GOP keeps the House and takes the Senate 55-45.

The newly elected leaders convinced they have a mandate; simoultaneously work to repeal “Obamacare” and enact Ryan’s bill. However, the Senate Democrats, having learned from the Republicans that a simple majority means 60 votes, refuse to let anything pass. The toxicity in Washington spills out into the country and blood is spilled while the politicians claim that they aren’t responsible.

I believe that there are elements in the GOP who hope that everything but the last 2 sentences of that come to pass. And if the last sentence does, they’ll be happy to blame the Dems.

“However, the growth promised by advocates of this budget does not materialize, ”

… well, yes. The ‘jobs’ and ‘job creator’ rhetoric used to push the Ryan plan and similar austerity budgets is just that – rhetoric. There is no actual economic mechanism behind it. Corporations have stockpiled enough cash to weather any ‘uncertainty’; smaller firms flourish or don’t according to whether or not their product or service reside in a current pocket of demand (those associated with microchips and their applications, rather than building construction, for example.)

Only if the Grand Conspiracy Theory of the left is true (and I don’t think it is at all) that American business is holding back just to make things uncomfortable enough to make Obama un re-electable, would this growth materialize.

Okay, Banty, a question. If the “Grand Conspiracy Theory,” as you call it, is a false meme, what IS the reason for the wealthier corporations holding on to their capital and not reinvesting it in their businesses by hiring and producing? The argument that the “demand side” of the economy cannot apply to that reason, since that is dependent on people having jobs, ergo being hired by capital-holding entities.

Sitting here in a job in an industry which is hiring like gangbusters and investing in new factories around the world *including* in the United States, I can tell you, dennis. It *is* demand. People are upgrading to smart phones; businesses are using some of that capital to replace servers. In this field, once any of our big competitors makes any move to more investment, everyone jumps in, because they have to.

The question is how to create demand widely in the US economy. People with jobs in the microelectronics industry can’t do it alone, and we’re widely globalized. Industries like construction will be held back by some time by the overhanging effects of the housing bubble, and that people and certain parts of the business sphere has a long slog of de-leveraging ahead of them. And, with that, many other sectors are still hunkering down, building up reserves.

How to fix all that? Well, it’s a chicken-and-egg problem. Clearly, the private sector, most of it, isn’t keen on making the first move. Risking a deflationary spiral for the whole economy, but, still, they are responding to their parochial interests. This is where the public sector should step in, but we both know that ain’t gonna happen.

I see. You paint a bleak picture and I don’t think it has to be that way. When we had near-full employment through the ’90s and into the 2ks, people were spending money left and right. People will spend if they have money; people will have money if they have jobs. Taking industry overseas and holding on to capital here is hurting Americans. You mention the globalized economy meeting overseas demands. Why can’t we meet overseas demands by manufacturing those tech products here in the U.S.? The answer is greedy corporations don’t want to pay decent wages or pay taxes that maintain the democratic lifestyle here in the U.S.

JimBob, really, why do you continue to post on this site when you have not one constructive idea or comment? All you do is rave like some angry lunatic and, frankly, it’s tiresome.

Yes, I know I don’t have to read your posts; but, I’d still like to hold out hope for ALL my fellow Americans that we can be sane and reasonable in solving our differences. The opposite is civil war. Is that what you REALLY want?

I’ve said this before, but it bears repeating. You guys ARE familiar with the internet concept of “the troll,” right? Basically someone who just says ridiculous crap to get a rise out of you. The long-cherished approach to dealing with them is embodied in the mantra “Don’t feed the trolls.” Ignore him. He’s irrelevant.

Don’t assume we’re as stupid, even and unpatriotic as the idiots running the GOP thank you. We’re Democrats and we care about our country and the world. The only thing you’ re people care about is the Kenyan Marxist in the White House.

During the debate over ObamaCare, it soon became clear that even moderate Dems in the Senate like Baucus had their own ideas about health care rather than defer to Obama and Speaker Pelosi.

And in retaliation, there followed a whole stream of liberal attacks on the very institution of the Senate itself as “obsolete,” “obstructionist,” “undemocratic,” etc.–just for frustrating liberal goals. Liberals especially denounced the filibuster, and demanded that the entire notion of unlimited Senate debate be scrapped.

Notice how all those liberal attacks on the institution of the Senate evaporated instantly, the moment the Republicans won control of the House in November 2010. Now, liberals actually see the Dem-controlled Senate as a firewall against the Tea Party Republicans in the House. If liberals had had their way, and the Senate had not existed, Boehner would be running the entire Congress now.

“Payback’s a b***h” is actually a special case of a more general principle:

I was stunned to see the main article on your home page titled “Payback’s a Bitch” with a photo of Nancy Pelosi holding a gavel below it. Translation: Nancy Pelosi is the bitch.

I’ve relied on FF to be a place where independents can come hear a reasonable conservative perspective without even name-calling and pettiness. Please re-consider your headline and photo of this article.

But he added: “The irony of the situation at the moment, with markets opening tomorrow morning, is that the biggest threat to the world financial system comes from a few right-wing nutters in the American congress rather than the eurozone.”

He already set out cuts for a grand bargain. So now, if he can talk Pelosi and Reid into it, they’ll take the cuts now, and bring up the Bush tax cuts during election season. Then the GOP will be forced to defend increasing the debt, and Obama and the Dems can argue for cutting the debt by raising taxes on the rich … um, “job creators”.

Brilliant political solution, that makes lemons of lemonade.

Frum and other RINOs were right. Boehner and Tea Bag Brigade will waddle around, Keystone-Kops-like, and regret ever decoupling revenues from cuts.

al Quaeda’s goal was to hurt America. They understood that they could not fight militarily with the US but could do everything in their power to destroy the economy. Ramming planes into buildings on 9/11 not only killed human beings on American soil, but had the added bonus for their evil plan, of almost destroying the economy.

So here we are, a decade later, and watching one of our own political parties holding the US hostage unless they get their way. My way or the highway, they say. If not, we will allow a breach of trust and destroy the credit and good name of the US, while watching their own citizens suffer from the consequences.

Now, I ask you…. pretty amazing isnt’ it, that like Imperial Rome, we will implode from within?

Because I live on the West Coast, I get the news from Asian markets before most Americans do. The Asians markets opened much lower today as a result of the failure of Congress of reached a debt ceiling deal. The slide has begun just as Steve Bell predicted a few weeks ago. By the end of the week, I predict an approximate 1000 point loss in the DJIA if a debt deal is not reached.

I admit I’m really pissed off. I cashed out last Thursday at the height of the market, but my children did not. Their retirement and educational funds will be hit big time. Worse still, their employment is in jeopardy. A default will mean double digit unemployment, somewhere in the official range of 20%. Interest rates will skyrocket for debt holders. And even worse, the BRICS will have the evidence they need that the US cannot be trusted fiscally to be the world’s reserve currency. As a result of potential or actual default, the arguments from the BRICS to change the default reserve currency from the US dollar will gain steam which will automatically increase interest rates in the US as borrowing costs will increase.

Political ideology has reached epic proportions to the degree that the entire US economy is at stake. But the partisan divide, as a result of gerrymandering which produces hardened ideology rather than a willingness to seek compromise, a media dominated by hardened ideologues, and focus group approved political rhetoric, is so great as Norm Ornstein notes in his latest editorial in Foreign Policy Magazine that there’s little chance of reaching a compromise.

It may well take a major decline in the US economy to depression levels…as well as the loss of the US dollar as the world’s reserve currency…to bring the US electorate to its senses. But I’m not betting on it. Too many decades have elapsed with too many political gamers in charge to bring the US back into alignment.

I’m really pissed off that this great country is being brought down so low as to seriously contemplate a self induced major depression – and loss of US prestige worldwide – to satisfy the ideology of a minority of the electorate. The US should be better…at least that’s what my early 17th Century ancestors believed when they left their farm in England to build a new life in the wilderness of Massachusetts and Connecticut.

This nation deserves better than the political gamesmanship being played out in Congress by extreme partisans. It deserves the concern for unity and stability that Geo. Washington exemplified over 200 hundred years ago. Anything less is not just of repudiation of our past but a failure for our nation’s future.

Obama has all the cards. Every single one. And he knows better than anyone that Karl Rove and the Murdoch Slime Machine are going to attempt to portray the results of a default as independent of the default, as though the two (the default and the results of the default) are unrelated. They are going to try to say that the ensuing chaos is the result of Obama’s economic policies, of “porkulus,” and turn a blind eye to the Tea Party’s intransigence. And he knows, given the state of the nation, that such a stratagem might even work.

I don’t think Boehner can round up the votes for a compromise. But Obama has all the cards anyway. I don’t even think he (Obama) needs the 14th Amendment, it certainly gives him some added firepower, but Congress passed a budget and it is his Constitutional duty as President and head of the Executive branch to execute the budget that Congress passed. Even if the House moves to impeach him, the motion would have to pass the Senate, which won’t convict. But what are they going to impeach him for? Doing his job? The end result of this debacle is that the debt ceiling is raised, or else it is abolished, by Executive fiat. The bottom line is that, in the absence of a deal, the Tea Party will have handed the President power that used to belong to Congress. In effect, they will have made the United States more authoritarian, more centralized, and given the Federal Executive more power, all at the direct expense of the Legislature and the people they (the Tea Party) represent.

So: well done, sirs. You have betrayed yourselves and your country, and set your own stated policy goals back, perhaps even irreversibly, because of your arrogance, your immaturity, and your lack of vision, focus, or any discernible mental acuity whatsoever. Well done.